BNB Smart Chain (BSC) has seen a mixed performance in the second quarter (Q2) of the year as the broader cryptocurrency market cooled following a strong price surge in March. While BNB, the native token of BSC, remained largely flat, down 5% quarter-on-quarter (QoQ), the key metrics showed both positive and negative trends.
Binance Smart Chain revenue drops
According to a recent report According to market intelligence platform Messari, network revenue, which measures the total fees collected by the network, fell 28% quarter-on-quarter to $48.1 million during the second quarter, although it was down just 8% year-over-year from $52.4 million in Q2 2023.
According to the report, this decline was largely driven by the drop in the price of BNB, as revenue in terms of the network’s native token decreased by 51% sequentially, from 165,100 BNB to 81,300 BNB.
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The report also highlighted a decline in network activity, with an average daily transactions decreasing 10% QoQ to 3.7 million and average daily active addresses falling 18% QoQ to 1.1 million. This trend was not isolated to BSC, as on-chain activity declined across most smart contract platforms in Q2 after a strong Q1.
Despite the overall decline, the report noted notable shifts in user preferences within the BSC ecosystem, as decentralized exchange (DEX) Uniswap experienced a significant increase in daily transactions, up 630% quarter-on-quarter, while the previously dominant PancakeSwap saw a 46% decrease quarter-on-quarter.
Staking increases by 30%, TVL drops
Messari also highlighted that total BNB staked increased by 30% quarter-over-quarter to 30.4 million BNB, with the total dollar value of staked funds increasing by 24% to $17.7 billion. This classifies the Binance Smart Chain as the third-largest Proof-of-Stake (PoS) network by staked value, although it still trails the Solana blockchain by a significant $38.4 billion.
BSC’s decentralized finance (DeFi) ecosystem, however, saw a decrease in total value locked (TVL), falling 24% QoQ to $5.5 billion, driven primarily by a 41% QoQ drop in lending on DeFi protocol Venus Finance.
The company notes that this indicates that the overall decrease in blocked value was partly due to the drop in the value of the BNB token, which closed the quarter at a low of $567, after reaching an all-time high of $722 in March.
Despite these fluctuations, Messari reported that Binance Smart Chain maintained the third-largest decentralized exchange (DEX) trading volume during the second quarter of the year, with $66 billion in total volume, behind only Ethereum (ETH) and Solana.
BNB Price Analysis
At the time of writing, the BNB token was trading at $586, up more than 2% in the past 24 hours. However, trading volume over the past 24 hours has dropped 3% to $830 million, according to CoinGeko. data.
Since Friday, the token has been consolidating between $570 and its current trading price, following the lead of the market’s largest cryptocurrencies after a failed attempt on Monday to break through its closest level. resistance wall at $590, which is the last hurdle preventing a move upwards towards the $600 mark.
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On the other hand, the key level to watch for BNB bulls is the 200-day exponential moving average (EMA) seen on the BNB/USDT daily chart below, with the yellow line just below the current price, which could act as a key support for the token, potentially preventing further declines.
Featured image of DALL-E, chart from TradingView.com